T-Mobile Customers: The iPhone Is Not Enough

By Quentin Fottrell

The proposal came out of the blue, but news that AT&T plans to buy T-Mobile in a deal valued at $39 billion has left T-Mobile customers spinning.

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If the antitrust authorities give their consent, it will be one that T-Mobile customers will not enter into willingly. T-Mobile fans are not looking forward to an expected reduction in the variety of pricing plans, and fear the end of unlimited smart phone data coverage on AT&T.

Those belonging to bigger fish – AT&T – are looking forward to a better service.

“The Unthinkable Has Happened”

Gigi B. Sohn, president and co-founder of the Washington-based public interest group, Public Knowledge, called the merger, “Unthinkable.”

But Larry Downes of CNET advised critics like Sohn to listen before judging. He says the real risk is that the deal does go through, but that the FCC or the Department of Justice drags its feet on deciding whether to approve the deal, “slowing the combined company’s ability to deploy new 4G service to nearly everyone.”

Others believe T-Mobile is fickle. As Matt Binder tweets: “Nothing says ‘we love our customers’ like airing commercials about how AT&T blows and then selling the company to them.”

(T-Mobile tells Pay Dirt it will continue to use spokeswoman Cary Foulkes, whose commercials have in the past poked fun at AT&T: “Until the deal is completed, which could take up to a year, we are operating as usual as an independent company and our marketing strategy remains in place.” But what about those snarky AT&T references? “The ads continue to evolve,” a spokesperson says.)

“We Can’t Out-Run AT&T”

On the T-Mobile official forum, one poster said: “I hate this. Every time I run away from AT&T they buy up who I ran to.”

Kelly, a contented and decade-long T-Mobile customer, explained on WSJ.com’s Digits blog why she believes people have flocked to AT&T: “Everyone I know who has AT&T complains constantly about cost, service, dropped calls. Of course, they have it because of the iPhone, which appears to be the only upside for consumers.”

A lingering grievance: AT&T isn’t after T-Mobile’s friendly customer service, brand or better pricing plans. It has come for its wireless spectrum, the much sought-after radio frequencies dished out to wireless companies by the FCC.

David, managing editor of the Tmonews.com, an unofficial T-Mobile blog, was on the AT&T investor call, and agrees with this thesis: “Improving network quality, an obvious eyesore for AT&T, is the big kicker here.”

“They are going after spectrum and are obviously paying for it,” he writes. “AT&T expects data usage to jump 8 to 10 times in overall usage in the next 5 years and they believe this deal gives them more than enough spectrum to handle that kind of growth.”

“We Stand To Win If AT&T Fails”

Another emerging trend: reluctant T-Mobile customers hope the merger fails because of the lucrative pay-off.

Andrew Munchbach of BGR.com notes the $3 billion break-up fee AT&T will have to pay T-Mobile. He doesn’t know if T-Mobile prices will increase, but adds, “What I can tell the T-Mobile faithful is this: whether the deal goes through or not, you will definitely win from a network prospective.”

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Pay Dirt examines the millions of consumer decisions Americans make every day: What to buy, how much to pay, whether to rave or complain. Lead written by Quentin Fottrell, the blog examines these interactions, providing readers with news, insight and tips on shopping, spending, customer service, and companies that do right – and wrong – by their customers. Send items, questions and comments to quentin.fottrell@dowjones.com or tweet @SMPayDirt.